The recent announcement of AWS about the savings plan for instances makes it now even easier to save money on EC2 instances and Fargate. You need to define your hourly instance spend by looking at the cost explorer and then you can reserve this hourly spend over a time frame of  either 1 or 3 years. Should the spend exceed the hourly committed rate at a given time then the on demand rate is charged.

There are two savings plans.

EC2 savings plan.

Same discount as standard Reserved instances.

This plan relates to a specific instance family in a specific region and gives the highest discount up to 72 %. It is flexible across size, OS and tenancy.

Compute savings plan.

Same discount as convertible Reserved Instances.

This plan offers more flexibility at the expense of a lower discount rate which maximum is 66 %.

Other than the flexibility above, this plan offers:

• Region agnostic ( except for China and Pacific Asia region Osaka).
• Instance family agnostic, just switch between the different families.
• Compute options e.g. move from EC2 to Fargate.

The new plan is a lot less complicated than the Reserved Instances model, which is a good development, as it is also far easier to ascertain your savings potential, by just deploying the cost explorer.